In the growth of inequality, technology is more to blame than globalization

The main reason for the increase in inequality in developed countries is technological progress, rather than globalization, the IMF’s new report says. In many of these countries, the share of workers’ wages in national income has been declining since the early 1990s. According to the research, half of this decline can be explained by the development of technologies that allow to automate routine operations, writes Financial Times. Thus, in these countries they have a much greater impact on the well-being of workers than globalization.

At the same time, capital owners in developed countries are increasingly benefiting from productivity growth. Since capital is usually concentrated in the hands of rich people, these trends are likely to lead to further growth in inequality, IMF experts say.

The report was published about a week before the meeting of finance ministers and central bankers from all over the world in Washington at the semi-annual summit of the IMF and the World Bank. This meeting will be the first after the victory of Donald Trump in the US elections; During the election campaign, Trump actively opposed globalization and promised to increase the number of industries in the US to restore the positions and earnings of the workers and the middle class. It is expected that at the IMF and World Bank summit, discontent with globalization in many developed countries will be the main topic of discussion.

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In : Economy

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